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Is Natus Medical Inc (NASDAQ:BABY) an outstanding investment now? The smart money is in a bearish mood. The number of bullish hedge fund positions stayed the same which is a slightly negative development in our experience

At the moment, there are plenty of methods shareholders can use to analyze stocks. Some of the most innovative are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite money managers can outclass the broader indices by a significant margin (see just how much).

Equally as important, positive insider trading sentiment is a second way to parse down the marketplace. As the old adage goes: there are many incentives for an executive to cut shares of his or her company, but only one, very obvious reason why they would behave bullishly. Many empirical studies have demonstrated the market-beating potential of this method if investors understand what to do (learn more here).

Now, it’s important to take a peek at the recent action regarding Natus Medical Inc (NASDAQ:BABY).

How are hedge funds trading Natus Medical Inc (NASDAQ:BABY)?

At Q1’s end, a total of 16 of the hedge funds we track were bullish in this stock, a change of 0% from one quarter earlier. With the smart money’s sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their holdings significantly.

According to our comprehensive database, Kevin Kotler’s Broadfin Capital had the most valuable position in Natus Medical Inc (NASDAQ:BABY), worth close to $34.8 million, comprising 7.6% of its total 13F portfolio. Sitting at the No. 2 spot is Camber Capital Management, managed by Stephen DuBois, which held a $22.4 million position; the fund has 1.8% of its 13F portfolio invested in the stock. Remaining peers that are bullish include Samuel Isaly’s OrbiMed Advisors, SAC Subsidiary’s CR Intrinsic Investors and J. Carlo Cannell’s Cannell Capital.

Because Natus Medical Inc (NASDAQ:BABY) has witnessed bearish sentiment from hedge fund managers, it’s safe to say that there lies a certain “tier” of fund managers that decided to sell off their entire stakes in Q1. It’s worth mentioning that Jim Simons’s Renaissance Technologies said goodbye to the biggest investment of all the hedgies we monitor, comprising close to $0.5 million in stock.. Jeffrey Vinik’s fund, Vinik Asset Management, also dropped its stock, about $0.4 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

What do corporate executives and insiders think about Natus Medical Inc (NASDAQ:BABY)?

Insider purchases made by high-level executives is particularly usable when the company in focus has experienced transactions within the past 180 days. Over the last half-year time period, Natus Medical Inc (NASDAQ:BABY) has seen 1 unique insiders buying, and 5 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Natus Medical Inc (NASDAQ:BABY). These stocks are Syneron Medical Ltd. (NASDAQ:ELOS), Invacare Corporation (NYSE:IVC), Symmetry Medical Inc. (NYSE:SMA), Cynosure, Inc. (NASDAQ:CYNO), and GenMark Diagnostics, Inc (NASDAQ:GNMK). This group of stocks belong to the medical appliances & equipment industry and their market caps are similar to BABY’s market cap.